NAIROBI, KENYA – Nairobi City County has been ranked as the most attractive destination for investment in Kenya, followed closely by Kiambu, Nyeri, and Murang'a, according to the inaugural County Competitiveness Index (CCI) report released on Saturday, November 1, 2025. The comprehensive study, commissioned by the Ministry of Investments, Trade, and Industry (MITI), highlights a significant economic disparity among the nation's 47 devolved units.

The report, financed by the European Union through Trademark Africa, provides a crucial data-driven analysis for potential investors and serves as a performance benchmark for county governments. It assessed counties based on a wide range of factors including the quality of infrastructure, healthcare, public security, local economic growth rates, employment levels, education, and the general business climate.

Nairobi achieved the highest competitiveness score of 77%, with the report citing its robust infrastructure, strong financial sector, and position as a national and regional economic hub. Kiambu followed with a score of 73%, benefiting from its proximity to the capital and a thriving real estate and agricultural sector. Nyeri and Murang'a both scored 61%, rounding out the top four most competitive counties for investment. Other counties that surpassed the 50% desirable threshold include Nakuru (57%), Machakos (56%), Mombasa (53%), Kirinyaga (52%), Embu (51%), and Tharaka Nithi (50%).

Arid and Semi-Arid Lands Lag Behind

In stark contrast, counties in the northeastern region were ranked as the least competitive. Wajir scored the lowest at 13%, with Tana River (14%), Garissa (15%), Marsabit (16%), and Mandera (17%) also at the bottom of the index. The report attributes these low rankings to “persistent challenges in infrastructure, human capital, and economic activity.” These findings underscore the deep-seated developmental challenges facing Kenya's Arid and Semi-Arid Lands (ASALs), which have historically been marginalized.

MITI Cabinet Secretary Lee Kinyanjui stated that the index is designed to guide investors seeking opportunities across the country and to inform county governments on areas needing improvement to enhance their attractiveness. The data provides a clear framework for policymakers at both national and county levels to address the specific weaknesses hindering investment and economic growth in lagging regions.

Divergent Metrics, Consistent Trends

The CCI's findings align with other recent economic analyses, although methodologies differ. A separate 2025 County Business Support Index (CBSI) by the African Institute of MSME Policy and Research and Viffa Consult ranked Uasin Gishu as the best county for small businesses, citing affordable licensing and strong support infrastructure. That study placed Machakos, Nairobi, and Nakuru in its top four. While the top counties vary slightly between reports, a consistent trend emerges: counties with better infrastructure, supportive local governments, and proximity to major economic zones perform significantly better.

Data from the Kenya National Bureau of Statistics (KNBS) further illustrates the economic dominance of the top-ranked counties. Nairobi alone accounts for a substantial portion of Kenya's Gross Domestic Product (GDP). Reports on Gross County Product (GCP) have consistently shown Nairobi and Kiambu as the highest contributors to national wealth. Conversely, analysis by the Controller of Budget on own-source revenue collection often shows a significant gap between high-revenue counties like Nairobi and those in less developed regions, which struggle to generate substantial local income.

Implications for Devolution and Economic Policy

The release of the County Competitiveness Index is a pivotal moment for Kenya's devolution process. It provides empirical evidence of the economic performance of counties more than a decade after the system was implemented. For the Kenyan public, the report offers a transparent scorecard to hold their county leaders accountable for creating enabling business environments that foster job creation and economic development.

For investors, both local and international, the index is a valuable tool for making informed decisions, potentially steering foreign direct investment towards counties that demonstrate a strong commitment to good governance and pro-business policies. The World Bank has previously ranked Kenya 56th globally in its Ease of Doing Business report, a measure the government aims to improve upon. This new county-level data will be critical in pinpointing specific areas for targeted reforms.

The challenge now lies with the underperforming counties to leverage this data to enact meaningful policy changes. This will require a concerted effort to improve infrastructure, invest in education and healthcare, streamline business licensing, and enhance security. National government support and equitable revenue sharing, as managed by the Commission on Revenue Allocation, will also be crucial in bridging the stark competitiveness gap revealed by this landmark report.